Thu, Nov 20, 2014 - Page 9 News List

Six years on, red lights are flashing on the global economy

The G20 meeting in Brisbane made it clearer than ever to British Prime Minister David Cameron that the nation must stick to its long-term economic plan

By David Cameron  /  The Guardian

Six years on from the financial crash that brought the world to its knees, red warning lights are once again flashing on the dashboard of the global economy.

As I met world leaders at the G20 summit in Brisbane, Australia, the problems were plain to see. The eurozone is teetering on the brink of a possible third recession, with high unemployment, falling growth and the real risk of falling prices. Emerging markets, which were the driver of growth in the early stages of the recovery, are now slowing down. Despite the progress in Bali, global trade talks have stalled, while the Ebola epidemic, conflict in the Middle East and Russia’s illegal actions in Ukraine are all adding a dangerous backdrop of instability and uncertainty.

The British economy, by contrast, is growing.

After the difficult decisions of recent years we are the fastest growing in the G7, with record numbers of new businesses, the largest-ever annual fall in unemployment and employment up 1.75 million in four years — more than in the rest of the EU put together — but the reality is, in our interconnected world, wider problems in the global economy pose a real risk to our recovery. We are already seeing that, with the impact of the eurozone slowdown on our manufacturing and our exports.

We cannot insulate ourselves completely, but we must do all we can to protect ourselves from a global downturn. Working through the agenda at the G20, it was clearer than ever how vital it is that we stick to our long-term plan at home and at the same time play our part in the international response to the global challenges on which our economic security also depends.

When we faced similar problems in recent years, too many politicians offered easy answers, thinking we could spend, borrow and tax our way to prosperity.

Those were the wrong answers then — they are the wrong answers now.

We are not going to repeat the mistakes of the past. Nor will we be successful by listening to those who suggest we can hide away from the world.

As the global economy faces greater uncertainty, it is more important than ever that we send a clear message to the world that Britain is not going to waver on dealing with its debt. This stability is vital in attracting the business and international investment that delivers growth and jobs, and which keeps long-term interest rates low. So we will stick to our plan on the deficit and continue to use monetary policy to support growth, without adding to borrowing or debt.

The G20’s Brisbane Action Plan reaffirmed the critical importance of this approach.

At the same time, we need to carry on with our plan to rebalance our economy so that we see an economic and industrial renaissance in every part of our country. Our long-term plan is backing business by scrapping red tape, cutting taxes, building world-class skills and supporting exports to emerging markets. Underpinning all of this is our radical program of investment in infrastructure.

Again this was a central theme at the G20 and Britain is proudly leading the way. We are making the biggest investment in roads since the 1970s and the biggest in rail since Victorian times, connecting 40,000 premises to super-fast broadband every week and starting an energy revolution with the first new nuclear plant in a generation, the world’s first green investment bank and the largest production of offshore wind on the planet.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top